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The backstory: Over the past decade, car manufacturers like Tesla, BYD and Rivian, have been in a competitive race to develop more efficient and affordable electric vehicles (EVs). Even legacy carmakers, like General Motors and Volvo, are getting into the game. As we approach 2024, they're not just working on new designs but also asking for extra support from policymakers for the cost of transitioning to EVs and the overall growing EV manufacturing industry. High interest rates and inadequate charging infrastructure pose some obstacles, limiting accessibility to EVs for many. But despite these challenges, more and more people worldwide are looking to electric cars, especially in China, Europe and the US.
More recently: In September, Munich hosted a big global car show called IAA Mobility, focusing on EVs. What stood out was that 41% of the companies there were from Asia, showing Asia's growing impact on the EV scene. European carmakers noticed that Chinese manufacturers are really good at making affordable EVs, making them rethink their plans to stay competitive.
The development: Recent market info from research firm Rho Motion shows that global electric car sales went up by 20% from last year. In November, battery-powered EVs made up 70% of those sales, with plug-in hybrids accounting for 30%. Even though there were concerns about slowing demand, monthly sales set a record at 1.4 million units. China and North America had increased sales, but Europe’s dropped a bit, compared to a strong end of the year in 2022 when Germans rushed to buy EVs before a launch of government subsidy cuts. Now, Germany and France are changing their subsidies to support electric cars made in Europe over Chinese competitors. Sales in Europe are expected to stay strong since automakers still need to meet emissions targets heading into 2025.
"EVs are going to be the future of the passenger automobile business," said Jeff Parent, COO of AutoNation (AN.N), the US auto dealership chain. But because of consumer concerns about price and charging, he said, "the next three to four years, things are going to be bumpy."
“I believe the time has come for Chinese brands,” said BYD chairman Wang Chuanfu at a BYD event in August. “It’s an emotional need for the 1.4 billion Chinese people to see a Chinese brand becoming global.”
"The more electric cars we have, the more we can benefit from economies of scale," Volkswagen CEO Oliver Blume said, “impressed” by China’s progress in EV tech and manufacturing.